WIXOM, MICH. -- The bookish, bespectacled Paul Ballew appears surprisingly sanguine, even optimistic, for a senior executive who watched his company's July light-vehicle sales fall 3.6 per cent in the U.S. and a whopping 19.2 per cent in Canada compared to the same month last year.

Still, Ballew, General Motors' executive director of market industry analysis, says the company remained solidly profitable in July, thanks mostly to GM's loan business rather than its automotive operations. General Motors Acceptance Corp. accounted for 64 per cent of GM's earnings in July.

As long as the automotive side is offering, according to investment dealer Merrill Lynch, consumer incentives averaging more than $4,000 (U.S.), it will be tough for GM to make money in the car business.

GM isn't alone. Consumers are enjoying record giveaways from all car companies, although many of them are quietly raising sticker prices to offset cash-back deals and low-finance rates. So buyer beware.

Perhaps Ballew is confident because, as Merrill Lynch analyst John Casesa says, "GM's fundamentals are improving in the face of an increasingly competitive environment."

During a media preview of the GM's 2005 models, Ballew said: "We see the backdrop continuing to improve" for the auto industry.

In that context, Ballew says GM plans to keep beavering away with a three-pronged strategy -- get the basics right, deliver best-in-class products, continue to strengthen GM's brands -- designed to improve profitability and, with some luck, even grow market share.

The third prong is really an extension of the second. Great products are the very essence of a strong brand in the car business. And for now, GM's product portfolio taken as a whole needs plenty of work.

In terms of the basics, GM is, indeed, on the right track by any objective measure. GM's numbers for long-term vehicle dependability are now above the industry average, as are its results for short-term initial quality.

GM still trails Honda, Toyota and Nissan in terms of plant productivity, according to the respected Harbour Study. But the gap is closing on the import-based companies and GM has a small lead on domestic rivals Ford and Chrysler.

For the company's critics, GM simply cannot move quickly enough. For its defenders, GM has managed a remarkable turnaround.

"We're still struggling with the challenges we incurred 15 years ago in this company," says Ballew, referring to GM's near-bankruptcy. Ballew and other GM's bosses make no apology for focusing on internal company processes before turning to improving the products.

Unfortunately, as Richmond Hill, Ont., analyst Dennis DesRosiers says, in the car business, product is everything.

By offering wave after wave of lacklustre cars and trucks throughout much of the 1980s and '90s, GM allowed its customer base to erode from a market share of more than 40 per cent to less than 30 per cent today.

"We're not winning hearts-and-minds across the [product] portfolio, and that's a challenge for us," Ballew says.

Not one to go unanswered, however. For the 2004 calendar year, GM introduced 18 new models (five exclusively for Canada) and for 2005, it has 13 more planned product introductions.

Among the big names coming this fall as 2005 models are the Buick Allure (LaCrosse in the United States) executive sedan, Cadillac STS luxury sedan, Chevrolet Cobalt compact sedan and coupe, Hummer H2 SUT, Pontiac G6 (replacing the Grand Am) and Saturn Relay minivan.

New models due which are exclusive to Canada include the Pontiac Wave (a version of the Cobalt) and a station wagon version of the Chevy Optra. Next year, look for GM to launch a new Buick LeSabre, a Hummer based on the Chevy Colorado pickup called the H3, a high-performance Chevy Corvette Z06 and the Pontiac Solstice roadster. Also interesting is a new entry to rival the Chrysler PT Cruiser called the Chevy HHR.

The HHR was designed by GM's new head of European design, Brian Nesbitt. Nesbitt was the designer of the PT Cruiser when he worked for Chrysler.

In the next 24 months, GM will be putting particular emphasis on reviving Buick with a $3.2-billion investment program. The aim is to duplicate at Buick what has become a noteworthy success story at Cadillac. So far this year, says Cadillac general manager Mark LaNeve, Cadillac is outselling Mercedes-Benz in the U.S.

But "that could change before the end of the year, so we're not planning the party yet," he says.

A healthy attitude. And those who have followed GM over the years will remember many promises of product-led revivals. Promises that later fell short of expectations.

So we will stick with certainties. Here are some of the highlights of what we know for sure will be coming from GM in the near future:

Hummer: A mid-size sport-utility vehicle called the H3 will hit showrooms in the first half of 2005. It will come at about the same time as a new line of off-road performance vehicles called Hummer Alpha.

The smaller Hummer SUV will feature a 3.5-litre, five-cylinder engine and offer the choice of a manual or automatic transmission. It also will have electronically controlled four-wheel drive, traction control and GM's vehicle-stability enhancement.

The low-volume Alpha series will begin with the 2006 H1 Alpha in early 2005. The H1 Alpha will be equipped with GM's brawny 6.6-litre Duramax turbo diesel engine (310 hp). It will provide more power, improved emissions performance and better fuel economy than the H1.

Cadillac: The 2005 STS arrives this fall with the edgy "art and science" design language we've already seen in the CTS executive sedan, SRX utility and XLR sports car.

The STS will come with a base 255-hp, V-6 engine. A 320-hp Northstar V-8 will be available on more expensive versions.

GM is optimistic about the STS because it is the third product to come off the well-received Sigma platform which is the basis for the CTS and SRX. Moreover, it will be built along with those others at GM's Lansing, Mich., Grand River plant.

Earlier this year Lansing Grand River won J.D. Power and Associates' Gold Plant award for assembling the highest quality vehicles of any North American plant. GM management is rewarding plant workers with a brand-new gym facility.

Cadillac will also introduce a new 2.8-litre, 210-hp V-6 engine for the CTS.

GMC: The Sierra Crew Cab Denali pickup arrives with unique exterior styling, a dressy interior, a 345-hp 6.0-litre V-8 and all-wheel drive. The Envoy and Envoy XL Denali also get a dressed-up cabin, special 17-inch wheels and a 300-hp V-8 with computer-controlled cylinder shut-off to improve fuel economy.

Chevrolet: The SSR roadster gets a power boost to 390 horsepower from its Corvette-shared LS2 V-8. Also, an optional six-speed manual transmission.

The HHR utility is a new small crossover to be launched in the summer of 2005 as a 2006 model. The Cobalt, a sibling of the Opel Astra sold in Europe, will be sold in coupe and sedan form. The base engine is a 145-hp four-cylinder and an SS coupe will get a 205-hp supercharged power plant. The 2005 Corvette will grab most Chevy headlines, though.

Buick: The Terraza is a sporty minivan with a 200-hp V-6 and a digital sound system. The Allure is the first in a series of new Buick sedans. The base engine is a 200-hp V-6 and a 240-hp V-6 will also be available.

Saturn: The Relay is a Saturn version of the Terazza, which itself is closely related to the Pontiac Montana and Chevy Venture minivans. The Ion small cars have been vastly improved and there is now Saturn Red Line high-performance models to consider.

Pontiac: The G6 replaces the Grand Am this fall and will be launched with a 200-hp V-6 engine. Coming next year are G6 models with a 170-hp four-banger and a 240-hp, 3.9-litre V-6. The Solstice roadster arrives as a 2006 model.

Saab: A new 9-3 Sport Hatch will join the 9-2X and 9-7X as models new to Saab showrooms.